European Central Bank delivers 25 basis point rate cut

Anadolu, Philippine News Agency

According to a flash estimate, headline inflation rose to 2.3 percent in the euro area as of November, up from 2 percent in October. (File Photo: Jurjen/Flickr, CC BY-NC-ND 2.0)

ANKARA – The European Central Bank (ECB) on Thursday lowered its three key interest rates by 25 basis points, aligning with market expectations.

The decision, effective December 18, is based on its updated assessment of the inflation outlook, the bank said in a statement.

The interest rates on the deposit facility, the main refinancing operations, and the marginal lending facility will be lowered to 3.00 percent, 3.15 percent, and 3.40 percent, respectively.

Noting that the disinflation process is well on track, the bank said headline inflation is projected to average 2.4 percent this year, 2.1 percent next year, 1.9 percent in 2026, and 2.1 percent in 2027

According to a flash estimate, headline inflation rose to 2.3 percent in the euro area as of November, up from 2 percent in October.

“For inflation excluding energy and food, staff project an average of 2.9 percent in 2024, 2.3 percent in 2025 and 1.9 percent in both 2026 and 2027,” said the bank.

Core inflation, which excludes volatile food, energy, alcohol, and tobacco prices, was stable at 2.7 percent in November.

Gross domestic product (GDP) in the eurozone rose 0.4 percent in the third quarter of 2024, accelerating from 0.

2 percent in the second quarter.

On an annual basis, the eurozone economy grew 0.9 percent in July-September, the largest leap since 2023, and up from 0.

6 percent in April-June. (Anadolu)